Qatar First Bank (QFB) and Novus Aviation Capital, one of the world’s fastest growing aircraft leasing platforms, have partnered in aircraft lease deal to indirectly acquire two Boeing 737s.
The indirect acquisition of two 2011 vintage Boeing 737-900ER single-aisle aircraft would be leased to Indonesia’s Lion Air, a QFB spokesman said.
The transaction will pay for the investment in two B737-900ERs, the largest variant of Boeing’s hugely successful Next Generation series which is the current production family for the B737.
Dubai-based Novus — a specialist in aircraft sourcing, trading, leasing and other related services — acted as sole arranger for both the financiering and leasing elements of the deal, with QFB exclusively involved in the Islamic financing part of the transaction.
“The transaction is in line with our strategy to diversify QFB’s revenue sources. We see opportunities in the aviation industry as it has historically generated relatively predictable returns over the medium to long term, something the market is in search off,” QFB chief executive Ziad Makkawi said.
The outlook for the leased aircraft type, the B737-900ER, is very favourable which has positive implications for the preservation of its market value, and more importantly will provide strategic investors with recurring and sustained income streams, according to him.
Makkawi said the focus of the bank, since its listing of shares on the Qatar Stock Exchange, was on generating steady income and offering Shariah compliant structured products.
“This attractive investment fulfils these objectives as the aviation industry has maintained a stable and sustainable growth path in comparison with alternative investment benchmarks,” he said.
Stressing that deploying capital, alongside its clients, and making investments in selected industries, such as the aviation sector, is an attractive direction in today’s challenging market and economic conditions; he said “we are in the process of structuring several Shariah-compliant products to enable our shareholders and clients, private and corporate, to participate in these investments.”
Earlier in May, QFB announced the development of a pioneering open architecture private banking platform, which is set to offer Shariah-compliant products including financing, private banking services, innovative investment solutions, as well as family office services covering trusts, foundations, advisory, real estate planning, and statement consolidation.
“We are very pleased to be partnering with QFB on another landmark aircraft transaction and look forward to further developing our relationship on other attractive yielding aircraft assets,” said Safwan Kuzbari, president and chief executive of Novus.
With a current portfolio of around $3bn, Novus has closed over 400 leases and financing agreements valued at $8bn and has executed aircraft transactions with over 40 major airline companies.